Related blog: 5 Steps Before Real Estate School : http://actvra.in/4NLp
How to start in real estate business have proven elusive for MOST new real estate agents. There MUST be a better way to begin!
90% of new real estate agents never see their 2nd year anniversary.
25,000 new agents are created annually in the State of Florida.
22,500 will be poorer, in debt, owing the IRS before they throw in the towel. This is their story.
In February 2015, Ahmed nailed his first sale! Just a few weeks had passed since getting his Florida Real Estate Sales License.
Today Ahmed is selling hover boards from a mall kiosk.
"My business started off great," Ahmed shares,"but you really have got to work that business. It takes a
lot of investment. I think I spent nearly $12,000 altogether and only sold one house. That's when I decided to take another route."
Ahmed first entered the USA on a H1B and worked in database management. After many years, Ahmed is now a permanent resident, living the American dream. Like so many, after a few years, he thought real estate would be a fun, challenging and lucrative business.
It's also an extremely competitive one.
With the recovery of the housing market in full swing, Ahmed was one of 26,000 people who passed the State of Florida real estate exam and on their way to becoming licensed REALTORS in 2015. Most of them will only make a few thousand dollars a year...if that.
Having joined a major real estate firm he said, "They 'nickle and dimed' me to death." Numerous fees and charges for marketing materials, services, required tools and resources eroded the potential to profit from real estate opportunities.
Further more, Ahmed retained his position as a database manager. He found it hard to sell real estate part time because of the frequent requests to show properties throughout the day.
Plan B.
Ahmed wanted to reduce costs and moved to a smaller firm and chose to change his business model. Buying houses to fix and flip. But that too, proved to be highly competitive.
"I'm just starting with limited cash flow. I bid on 8 houses and got beat by corporations offering a higher 
amount than I could dream of."
With the guidance of a friend, Ahmed landed the job at the mall, demonstrating and selling hover boards. His friend sells drones in the adjacent kiosk.
Today, Ahmed uses his real estate license only to flip houses. He has completed four flips for a modest profit. If you calculate the time invested and profit made, one could argue whether any profit was realized at all.
Would Ahmed advise others to enter real estate?
"I would probably tell them 'If that is where your heart is,' but it is best if you have some capital saved up or you're living with Mom and Dad and don't have any responsibilities. If I had not made a little money on the flip side, I would not invest the money in becoming an agent again."
Ahmed is an extremely smart and motivated fellow. Yet the illusion that "real estate would be a fun, challenging and lucrative business" set him back many thousands of dollars. Having gained some experience to analyze the situation better, he implemented a Plan B.
Are you seeing a potential that real estate could be 'a fun, challenging and lucrative businesss'? Give yourself a time-out and get the real information you need.
As the story of Ahmed reveals, he simply did not have the data needed to make a good decision. Did not have the data needed to create a strategy, to identify where HIS real estate market existed.
One might ask, "What did he learn in the real estate school he paid to attend?" Clearly nothing about the "business" of real estate.
Those attracted to the "real estate would be a fun, challenging and lucrative business" allure should heed the following advise.
There are hundreds of ways to make money in real estate. If you do not define YOUR WAY first, it is highly unlikely, as 90% of newbies discover, your way will EVER be found.
Like any business owner, you need to start with a business plan. Yes, a business plan before you plunk down the first dime to pay for schooling in real estate. There are many real estate business plans freely available as the result of a G search. Preparing a business plan FORCES you to define your business and know your costs and locate where the money is located. (shhh, keep this a secret. I do have a 'before getting licensed' guide you can request.)
It is true that no place exists for you to get many of the answers you will need. That is when you check out the menu at Panera Bread. What is the cost of a Cheese Danish and a cup of coffee? Your research is going to cost you Cheese Danish and coffee, five times.
Step One. There are answers you need but can not obtain except from other real estate agents. Make a 
list of five agents. One each from franchises like, Coldwell Banker, Remax and Keller Williams. Another from a boutique broker who is not part of a major franchise but is a local broker. Finally, pick a phone number from the signs posted by investors. Some have those 'Cash for your home, any condition!" signs along the street side and nailed to posts. (What to ask? I have the questions and interview dialog in the secret guide)
Call these agents, explain your purpose and schedule a meet up at Panera Bread for their help in fleshing out your business plan.
You will get a wildly varying description regarding what a profession in real estate REALLY is! This should make clear to you that if you don't define your business others will define it for you or lead you astray by encouraging the 'accidental real estate' model. That is the model forced on 90% of brand new agents.
Be fully aware, it is possible a license would not be needed to implement your plan and could prove a hindrance. It is possible you may not need to be a REALTOR or join the board. The real estate business is changing and younger minds are driving those changes.
Step Two is scheduling a meet-up with brokers recommended to you by those you treated to a Cheese Danish. This meet-up is to determine two things. They are:
1. Which broker is best suited to implement YOUR business plan and get you engaged in transactions the fastest.
2. The average number of transactions completed annually per agent in that office. This is the measure that validates all the promises and sweet words you will hear. If your business plan requires 10 transactions the first 12 months and the average for that office is 5, you don't want to hang your license there. The national average is 7. As an example, the average transaction count for my REMAX office is 19. This should indicate the training, systems, compensation, support are contributing to agent success and the 'average' agent exceeds your business plan requirement. You need to follow where the evidence of success exists. (the guide goes into greater detail)
The final step after identifying the right broker, and from that point forward it becomes a matter of whether:
- You are teachable,
- You will follow directions,
- Keep your commitments.
How you start your real estate career will reflect how your career will end. This is a tough business and entering it should be preceded with the same due-diligence required of any small business owner.
If you are considering giving real estate a try, there is crucial information you need to know and analysis you must make. Without doing so is comparable to a store owner throwing open the doors without knowing what is to be sold, from where the products come, cost of products, retail price of product, who is the buyer, where is the buyer, what will the buyer pay and the overhead that must be paid.
Most new agents arrive at their broker office on their first day and ask, "Now what?" For 90 percent of them the "now what" is a return to their previous job before they can celebrate their 2nd year anniversary.
Request the guide. The guide is specifically for those 'thinking about it,' preferably BEFORE you pay for the licensing course and definitely before choosing a broker. However, even those who recognize a restart is in order will benefit. If you are serious, I am sure you can figure out what to do next.
THE BOOK IS NOW READY!
You can preview the first 10 Pages on LuLu by clicking here.
If you beleive this book will be benefical to you, contact me. I can send you a PDF at a much lower cost.
Best of success,
Annette Lawrence, Broker/Associate
REMAX Realtec Group
Palm Harbor, FL
727.420.4041
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